Put Off Going Self Employed As A Writer

notanewuser

dktreesea wrote: »

Does anyone start a business sufficiently well capitalised to not have to rely on benefits in the formative years?

Yes thanks.

dktreesea

notanewuser wrote: »

Yes thanks.

Because you saved up first? Or maybe were not entitled to benefits because of the earnings of another member of your household (parents, spouse)? Or were wildly successful from the outset so never had low enough profits to entitle you to benefits?

Not everyone starting a business is quite so fortunate, but surely it shouldn't stop them from having a go?

notanewuser

dktreesea wrote: »

Because you saved up first? Or maybe were not entitled to benefits because of the earnings of another member of your household (parents, spouse)? Or were wildly successful from the outset so never had low enough profits to entitle you to benefits?

Not everyone starting a business is quite so fortunate, but surely it shouldn't stop them from having a go?

We have a consultancy. I do bits and pieces, but DH consults full time (and more). We started with only minor costs for setting up the ltd company. DH has spent years building his reputation, often through voluntary/unpaid work. He's in demand. Turnover for last (1st) year was over £100k.

There is no reason at all that the OP cannot "have a go". Perhaps in his spare time as has been suggested, and continuing to look for paying work.

dktreesea

notanewuser wrote: »

We have a consultancy. I do bits and pieces, but DH consults full time (and more). We started with only minor costs for setting up the ltd company. DH has spent years building his reputation, often through voluntary/unpaid work. He's in demand. Turnover for last (1st) year was over £100k.

There is no reason at all that the OP cannot "have a go". Perhaps in his spare time as has been suggested, and continuing to look for paying work.

People who start up businesses in a line of work they are already in, or who have a line of work that is suitable for turning into a business, probably are able to hit the ground running. I did contracting for quite a few years, and there was never a time when I had no income, because I knew the project end date weeks out so could always line up some more work.

But if you are starting a business up like, e.g. retailing, when you haven't worked with product before, much less sold it, or leasing and running a private hire car even though you were a security guard (as opposed to a taxi driver) before you got laid off, it's quite possible that it could be years before you start to show a good income.

neverdespairgirl

dktreesea wrote: »

Does anyone start a business sufficiently well capitalised to not have to rely on benefits in the formative years?

Of course they do.

I started working in self-employment in April 2002, and turned a profit in my first year's accounts of £6k. Second year, £14k-odd.

dktreesea

neverdespairgirl wrote: »

Of course they do.

I started working in self-employment in April 2002, and turned a profit in my first year's accounts of £6k. Second year, £14k-odd.

But if you had a family, both of those profits would have entitled you to some support from the state, even back in 2002, assuming household income from other members didn't preclude this. At that time, wouldn't an income of £6k have qualified you for things like working families tax credit, housing benefit and child benefit? Even for an income of £14k, wouldn't you have been able to claw some of the income tax back through children's tax credits if you had qualified for this rebate?

dktreesea

I'm not saying that people who start up a business and only have a low income in the formative years are going to claim benefits, or even be eligible for them. A person living at home who is 16 or 17 and startsz their own business would probably have to look to a group like The Prince of Wales Trust for financial investment/support rather than the benefits system. And there would probably be plenty of self employed people who can't claim anything because of their partner's earnings.

But if the HMRC's statitstics are to be believed, there is a significant portion of self employed people who don't make enough profit to even pay for their accommodation costs, let alone to live on. If they can all have businesses, even if they are heavily subsidised by the taxpayer, why shouldn't the OP have the same?

notanewuser

dktreesea wrote: »

I'm not saying that people who start up a business and only have a low income in the formative years are going to claim benefits, or even be eligible for them. A person living at home who is 16 or 17 and startsz their own business would probably have to look to a group like The Prince of Wales Trust for financial investment/support rather than the benefits system. And there would probably be plenty of self employed people who can't claim anything because of their partner's earnings.

But if the HMRC's statitstics are to be believed, there is a significant portion of self employed people who don't make enough profit to even pay for their accommodation costs, let alone to live on. If they can all have businesses, even if they are heavily subsidised by the taxpayer, why shouldn't the OP have the same?

So it's okay because lots of other people are doing it?!

Statistically lots of people are defrauding the taxpayer by claiming things they aren't entitled to. Should the OP do that as well?

Somerset

dktreesea wrote: »

But if you are starting a business up like, e.g. retailing, when you haven't worked with product before, much less sold it, or leasing and running a private hire car even though you were a security guard (as opposed to a taxi driver) before you got laid off, it's quite possible that it could be years before you start to show a good income.

This is a hypothetical response.

Why the above ? If a person can start up any random business but it is always someone else's money on the line ( the govt's/taxpayer's ) why is that a good thing ?

The country may be encouraging self-employment, but 'help' doesn't mean an open-ended cheque.

dktreesea

notanewuser wrote: »

So it's okay because lots of other people are doing it?!

Statistically lots of people are defrauding the taxpayer by claiming things they aren't entitled to. Should the OP do that as well?

How is it fraud? You set up a business. At the point you set it up, your income is zero. You expect to make "x" in the first year. You obtain benefits based on that estimate. If it turns out you estimated £5k profits in the first year, and instead you made £45k, all those benefits, including housing benefit, will be designated overpayments and will be recoverable by the state. Where's the fraud?

If someone sets up a business, they, as a self employed person, are entitled to benefits. How is someone becoming self employed and then claiming for benefits committing fraud? The OP wouldn't be claiming anything he isn't entitled to. He's setting up a genuine business. Just because someone else may not think it has any hope of succeeding doesn't mean it's not a genuine attempt to make a go of something.

Whether that business would meet the requirements to be regarded as "gainfully self employed" under UC is a different matter. But we're not at that stage yet.